Is a Circle K purchaser ever obligated to reimburse the Competitive Allowance to the seller?

According to Circle K's 2025 Franchise Disclosure Document, a purchaser is not obligated to reimburse the Competitive Allowance to the seller. The Competitive Allowance is a payment made by the seller to the purchaser for each gallon of product purchased from the seller under the Motor Fuel Agreement, as specified in the Incentive Amounts Schedule. The seller may modify or terminate the Competitive Allowance with 30 days' notice, and the obligation to pay it ends if the Motor Fuel Agreement is terminated. However, the purchaser is never required to return any of the Competitive Allowance received.

This provision protects Circle K franchisees by ensuring they do not have to pay back the Competitive Allowance under any circumstances. This allowance is designed to help franchisees remain competitive in their local markets, and the assurance that it does not need to be repaid provides financial security.

It is important for prospective franchisees to understand the conditions under which the Competitive Allowance is paid and can be modified or terminated. While the franchisee is not obligated to reimburse the allowance, the seller can change or end the allowance with 30 days written notice. This could impact the franchisee's profitability and competitive position.